U.S. v. Mechanic, 86-2223

• Decision Date: 30 January 1987
• Docket Number: No. 86-2223,86-2223
• Citation: 809 F.2d 1111
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Bahram MECHANIC, a/k/a Barry Mechanic, a/k/a Myron Bahram Mechanic, and Mary Akers Mechanic, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1111

809 F.2d 1111

UNITED STATES of America, Plaintiff-Appellee, v. Bahram MECHANIC, a/k/a Barry Mechanic, a/k/a Myron Bahram

Mechanic, and Mary Akers Mechanic, Defendants-Appellants.

No. 86-2223.

United States Court of Appeals, Fifth Circuit.

Jan. 30, 1987.

Mike DeGeurin, Houston, Tex., for defendants-appellants.

Philip Hilder, Asst. U.S. Atty., Henry K. Oncken, U.S. Atty., James R. Gough, Asst. U.S. Atty., Houston, Tex., for plaintiff-appellee.

Appeals from the United States District Court for the Southern District of Texas.

Before GEE, POLITZ, and WILLIAMS, Circuit Judges.

GEE, Circuit Judge:

Bahram and Mary Mechanic were convicted of attempting to export a microwave calibration device without a validated export license, in violation of the Export Administration Act (EAA) of 1979 and regulations promulgated under that Act. They raise a constitutional challenge to the regulation that proscribes attempts to violate the Act. Because we conclude there is no constitutional infirmity, we AFFIRM.

Facts

The facts relevant to this appeal are undisputed. Bahram (Barry) Mechanic and his ex-sister-in-law, Mary Akers Mechanic, constituted the entire personnel roster for Faratel, Inc., an operation located in a small office in Houston, Texas. In December 1984, Mary called Hughes Aircraft to obtain a quote for a plug-in sweep generator, stating Faratel had a West German client who wanted one shipped to Switzerland. Hughes gave a foreign price quotation, adding that the item was subject to United States export control regulations and that delivery was contingent upon receipt of a validated export license. In February 1985, Mary called Hughes again, but requested a domestic price quotation, stating that Faratel had a foreign client who intended to use the device in a Houston-based beeper-pager operation. This use is not compatible with the requested equipment, which is primarily used in laboratories to develop radar and military communication systems, such as guided missile tracking.

Hughes shipped the equipment in late March 1985. Executing a search warrant, the U.S. Customs Service intercepted the crate at a Houston airport and installed a tracking device. While maintaining surveillance, Customs Service personnel observed Barry and Mary repack the generator in a footlocker. They later observed one Eugene Krug check the footlocker as baggage on his flight to Zurich. Krug was detained at the airport and Barry and Mary were later arrested. The first trial resulted in a hung jury; the jury at the second trial acquitted Krug, but convicted Barry and Mary.

I. Constitutionality of the Regulation Prohibiting Attempts to Export

When the Mechanics were busying themselves with the sweep generator in April 1985, the Export Administration Act of 1979 was not in effect of its own force. On the expiration date of Congress's last extension of the Act, March 30, 1984, the President issued Executive Order No. 12470, pursuant to special powers granted him under the International Economic Emergency Powers Act (IEEPA). Pub.L. No. 95-223, 91 Stat. 1625 (1977) (codified at 50 U.S.C. Sec. 1701-1706). The Order declared a national economic emergency and continued the operation of the provisions of the EAA of 1979 and all rules and regulations under it. The President revoked the Order after signing into law the Export Administration Amendments Act of 1985 (EAAA). Pub.L. No. 99-64, 99 Stat. 120 (July 12, 1985). Thus, at the time the offenses were committed in April 1985, the EAA of 1979 rested solely upon the President's exercise of his powers under the IEEPA.

Furthermore, a regulation, and not the EAA itself, denounced an attempt to violate export controls as a criminal offense, as follows:

Solicitation and attempt. No person may do any act that solicits the commission of, or that constitutes an attempt to bring about, a violation of the Export Administration Act or any regulation, order, or license issued under the Act.

15 C.F.R. Sec. 387.3(a) (1985).

The EAA of 1979 imposed criminal sanctions on those who knowingly violate any provision of the Act or any regulation issued under it. 50 U.S.C. App. Sec. 2410(a) (1982).

The Mechanics contend that the regulation establishing the attempt violation exceeds the delegation of authority granted under the EAA. That is, the regulation exceeds the stated policy and unconstitutionally "enlarges the terms" of the Act.

The congressional declaration of policy, embodied in the Act, provides

It is the policy of the United States to use export controls only after full consideration of the impact on the economy of the United States and only to the extent necessary--

(A) to restrict the export of goods and technology which would make a significant contribution to the military potential of any other country or combination of countries which would prove detrimental to the national security of the United States;

(B) to restrict the export of goods and technology where necessary to further significantly the foreign policy of the United States or to fulfill its declared international obligations....

50 U.S.C.App. Sec. 2402(2)(A), (B) (1982). The EAA goes on to establish that, in order to further these policies, the President may "prohibit or curtail" the exportation of any goods, technology, or other information subject to the jurisdiction of the United States. 50 U.S.C.App. Sec. 2405(a)(1) (applying to foreign policy controls); 50 U.S.C.App. Sec. 2404(a)(1) (applying to national security controls).

Our Court addressed virtually the same constitutional issue in Samora v. United States, 406 F.2d 1095 (5th Cir.1969). In that case, the defendant was convicted of violating the Munitions Control Statute, 22 U.S.C. Sec. 1934, and regulations under it, by attempting to export handguns to Mexico without an export license. As in today's case, a regulation, not a statute, expressly forbade attempts to export unlawfully. The parallels continue, in that the statute applied criminal sanctions to any person who willfully violated any statutory provision or any rule or regulation issued thereunder. The Samora Court reiterated the long-established rule that "Congress may validly provide a criminal sanction for the violation of rules or regulations which it has empowered the President or an administrative agency to enact. Id. at 1098 (citing United States v. Grimaud, 220 U.S. 506, 31 S.Ct. 480, 55 L.Ed. 563 (1911)). In Samora, the statute empowered the President "to control, in furtherance of world peace and the security and foreign policy of the United States, the export of arms, ammunition, and implements of war, including technical data relating thereto." 22 U.S.C. Sec. 1934(a) (1964). In finding this delegation of authority constitutional, we observed that "in the field of foreign affairs, the authority delegated to the President may be broader and the requisite standards more general than in matters purely domestic." Id. (citing Zemel v. Rusk, 381 U.S. 1, 85 S.Ct. 1271, 14 L.Ed.2d 179 (1965); United States v. Curtiss-Wright Export Corp., 299 U.S. 304, 57 S.Ct. 216, 81 L.Ed. 255 (1936)).

We perceive no basis for departing from the reasoning and result in Samora. The congressionally-defined policy underlying the EAA is explicitly related to the foreign policy ¹ of the United States, as was the policy undergirding the munitions control statute in Samora. Furthermore, under...